Starboard nominates four to eBay's board, wants outsider as CEO
Mar 19, 2020
Activist investor Starboard Value is pressuring eBay for the second time in two years and said on Thursday that it plans to install four directors on the e-commerce company’s 14-member board.
The hedge fund, which last year helped fill one board seat, said the board had been slow in changing its chief executive and tackling issues including separating eBay’s classifieds business from its marketplace business.
EBay said on Thursday the nominations are “unwarranted and unreasonable.”
Starboard said in a letter that it wants the board to appoint an outsider as permanent chief executive after eBay has been headed by an interim CEO for six months. In September, Devin Wenig stepped down after disagreements with the board, and Scott Schenkel, eBay’s chief financial officer, was appointed interim CEO.
“Given our concern over certain historical decisions, we worry that the board may default to an internal candidate,” Starboard wrote.
The e-commerce firm’s CEO search process does include external and internal candidates, it said on Thursday.
“We are disappointed that Starboard has decided to announce its previously provided nominations amidst the global COVID-19 pandemic while the Board and management are trying to focus on the business, employee health and safety, and the important CEO search and portfolio review that are underway,” eBay said.
Starboard’s nominees include Peter Feld, the hedge fund’s director of research, Shannon Brayton, who most recently served as the chief marketing officer of LinkedIn, Eddy Hartenstein, who currently serves as the lead independent director on Broadcom Inc’s board, and Stephanie Tilenius, who has previously worked at Google.
Starboard, which owns more than 1% of eBay common stock, has been holding private discussions with the company for months but moved ahead with a proxy fight this week to publicly push its case for hiring a “world class experienced leader for eBay.”
Reuters reported last week, citing people familiar with the matter, that Starboard would nominate a minority slate of directors.
EBay also made changes to its board last year following requests from activist investors Elliott Management and Starboard. Elliott owns 4% of eBay.
EBay sold StubHub to ticket reseller Viagogo Ltd for $4.05 billion in November. The company has said that it plans to release an update on the classifieds business by the middle 2020.
EBay’s shareholder meeting is expected to be held in June.
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